The financial structure of the deal is designed to accelerate the development of the project. Eurobattery Minerals intends to complete the investment in two tranches during 2024: an initial payment of €1.5 million, followed by a second tranche of €1 million. Upon the payment of the first tranche, the company will secure its full ownership stake. The funds are earmarked primarily for the design and construction of a processing plant, as well as to provide working capital for the start of production. According to the company’s timeline, the first delivery of tungsten is expected in 2025.
The economic significance of the San Juan deposit lies in its scale and the strategic importance of the mineral it yields. Tungsten San Juan has identified proven reserves of 60,000 tonnes at a grade of 1.3% WO3, equating to 78,000 metric tons of units (MTU). However, the company’s projections suggest a much larger potential. By considering a potential extension of the open-pit mine and other reserves in numerous skarn outcroppings, Tungsten San Juan forecasts a mining objective of at least 960,000 MTU. This figure represents more than twelve times the size of the currently proven reserves, indicating that the initial small-scale open-pit production is merely the beginning of a potentially significant European tungsten supply source.
Tungsten is not a commodity subject to the same consumer cycles as lithium or cobalt; its demand is driven by high-performance industrial applications. It is essential in electronics, the power industry, aeronautics, and defense. Roberto García Martínez, CEO of Eurobattery Minerals, described the acquisition as a “game changer” that will “transform the company’s DNA.” He highlighted that tungsten-enhanced steel is vital for the defense industry, underscoring the geopolitical and strategic dimensions of the deal. For Eurobattery, this move aligns with its broader vision of making Europe self-sufficient in responsibly mined battery minerals, though it also acknowledges the broader industrial demand for critical raw materials.
The operational readiness of the San Juan project is a key factor in the deal’s attractiveness. Tungsten San Juan states that it has all necessary licenses and contracts in place to commence production. Notably, the company has secured a letter of intent for an off-take agreement with Wolfram Bergbau und Hütten AG, an Austrian tungsten producer within the Swedish Sandvik Group. This partnership suggests a clear market pathway for the extracted material, reducing one of the primary risks associated with new mining ventures: finding a buyer. The involvement of Sandvik, a global industrial giant, lends credibility to the project’s commercial viability and integrates the Spanish deposit into an existing European industrial supply chain.
For Eurobattery Minerals, this acquisition complements its existing operations in Finland. The company is the majority owner of the ground and mining rights to the Hautalampi nickel-cobalt-copper project and the Corcel nickel-copper-cobalt project in Galicia. In November 2022, Eurobattery appointed Ilari Kinnunen as the new Managing Director of FinnCobalt Oy, the Finnish subsidiary responsible for the Hautalampi project. Kinnunen, who brings nearly 20 years of experience in the mining sector and an M.Sc. in Mineral Engineering from Aalto University, has been tasked with advancing the pre-feasibility study for the Hautalampi mine. His appointment, succeeding the retiring Markus Ekberg, reflects the company’s continued commitment to developing its Finnish assets. While the Finnish projects focus on battery minerals, the Spanish tungsten acquisition broadens the company’s exposure to critical raw materials, potentially stabilizing revenue streams through a different market dynamic.
The broader context for this investment is the European Union’s push to reduce dependence on non-EU sources for critical materials. Tungsten, like other rare and strategic metals, is often imported from outside the continent. By bringing an unmined Spanish deposit into production, Eurobattery contributes to the reshoring of strategic industries, a trend echoed in various national defense and industrial strategies. However, the deal remains at the letter of intent stage, meaning it is not yet legally binding. The transition from intent to execution will depend on the completion of due diligence and the successful closing of the financial tranches.
Uncertainties remain regarding the technical realization of the expanded reserves. While the proven reserves of 78,000 MTU provide a baseline, the forecasted 960,000 MTU relies on the successful extension of the open pit and the economic viability of mining the additional skarn outcroppings. These factors are subject to geological verification and market conditions. Additionally, the construction of the processing plant represents a significant capital expenditure and operational challenge, particularly for a company of Eurobattery’s size. The company’s ability to manage this expansion alongside its Finnish projects will be a test of its operational capacity.
As Eurobattery Minerals prepares to inject capital into the San Juan project, the focus shifts to the practicalities of construction and initial production. The first tungsten delivery in 2025 will be a critical milestone, serving as a proof of concept for the new processing facility. For the company, the success of this acquisition will determine whether its diversification into tungsten becomes a cornerstone of its European mining strategy, or merely a speculative addition to its portfolio. The next data points to watch will be the completion of the second investment tranche and the commencement of open-pit operations in Galicia, which will validate the company’s claims regarding the deposit’s potential.
